Brands in Time of Crisis

When Summer Mills visited her local CVS drugstore recently, to save a few dollars she bought the store-brand facial scrub rather than the Olay version she normally uses.

“I thought I’d be able to tell the difference, but I couldn’t — I looked at the ingredients and they seemed almost the same,” says 30-year-old Ms. Mills, a stay-at-home mother of two in Ardmore, Okla. On her next shopping trip, “I’m going to buy the store-brand moisturizer and cleanser — it’s less money.”

Many Americans are changing their everyday purchases and abandoning brand loyalty, prompted by the persistent financial pressure of rising food, gasoline and electricity prices. 

Retailers are also sensing more shopper experimentation. This fall, supermarkets Safeway Inc. and Kroger Co. noted that sales of their store brands are on the rise. “In this economy, customers are much more willing to try a private-label item, and we’re seeing signs that this is happening more and more as the year progresses,” Kroger CEO David Dillon said on a conference call.

To be sure, overall sales of name-brand goods are still higher than those of store brands. Still, about 40% of primary household shoppers said they started buying store-brand paper products because “they are cheaper than national brands,” according to a September report by market-research company Mintel International, which interviewed 3,000 consumers. Nearly 25% of respondents reported that it is “really hard to tell the difference” between national brands and store brands of paper products. Store brands on average cost 46% less than name-brand versions, Mintel found.

The above paragraphs are extracted from todays WSJ’s article At the Supermarket Checkout, Frugality Trumps Brand Loyalty .

Crisis provides brands a challenge and an oportunity. Is the time that most of the brands will be put to test by tougher buying conditions or pricing beyond brand as a final buying argument.

It’s the time new brands can made their way up into the consumers minds and benefit later from surviving these harder times.

Five Management Traits For Global Brands

Via Brandchannel & Interbrand, an interesting list of five management traits that are employed by leading global brands.

Seek out insights:

Outstanding brands identify customer insights. When these insights are shared across cultures they assist in a brand’s adoption globally.

Integrate local intelligence:

Brand guidelines are tremendous tools for ensuring consistency. However, they have been known to impede innovation and diminish relevance. Brands are dynamic, never static, so the management of them must integrate new thought. In the case of global brands, to assume that one message can appeal uniformly to all audiences with equal relevance is unrealistic. Well-managed global brands cull local markets for intelligence related to the ‘next big thing’ to ensure local relevance and to counter competitor’s moves.
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Risk and Rewards for Global Brands

Very interesting Interbrand white paper which explores the attraction and risks associated with brands that are going global.

Successful global brands achieve a high degree of consistency in visual, verbal, sonic and tactile identity across geographies. They deliver a consistent customer experience worldwide, often supported by an integrated global marketing effort.

The risks of taking a brand global must be carefully weighed or the damage to the brand can be irrevocable. These risks include, but are not limited to:

  • Erroneously assuming the brand communicates the same meaning market-to-market, resulting in message confusion
  • Over-standardizing or over-simplifying the brand and its management, resulting in a culture of discouraged innovation at the local level
  • Use of the wrong (or tried and true) communications channels, resulting in inappropriate spending and ineffective impact
  • Underestimating the investment in spending and time for a market to become aware of the brand, try it, and adopt it
  • Not investing in internal brand alignment to ensure that regional employees understand the brand values and benefits and are able and willing to communicate and deliver consistently
  • Failing to modulate performance metrics based on local variables

Interbrand has identified a consistent set of principles shared by successful global brands.

Well-performing brands enjoy strong awareness among consumers and opinion leaders. These brands lead their industry or industries.

These brands achieve a high degree of consistency in visual, verbal, sonic and tactile identity across geographies. They deliver a consistent customer experience worldwide, often supported by an integrated global marketing effort.

A brand is not a brand unless it competes along emotional dimensions. It must symbolize a promise that people believe can be delivered and one they desire to be part of. Through emotion, brands can achieve the loyalty of consumers by tapping into human values and aspirations that cut across cultural differences.

Great brands represent great ideas. These brands express a unique position to all internal and external audiences. They effectively use all elements in the communications mix to position within and across international markets.

Global brands must respect local needs, wants and tastes. These brands adapt to the local marketplace while fulfilling a global mission.

The organization’s senior leadership must champion the brand, ideally with the CEO leading the initiative. A leader’s continual articulation of the brand philosophy and the brand’s view of the world is meant to give the business strategy a recognizable face.

Download the full white paper (PDF)

10 Key Attributes of Brand-Guided Company

Booz Allen Hamilton and the brand consulting firm Wolff Olins carried out research among marketing executives across Europe. It shows that over 90 percent of companies believe their brand is a key element of their success—twice as many as five years ago. Yet less than 20 percent put the management of their brand at the heart of their business systems and capabilities. This appears to be significant in explaining superior brand performance.

The study identified three categories of organizations:

Brand-guided companies

…recognize the importance of brands and sound management of brands for their business success. They have established a common understanding of what the company stands for, and hence have assigned clear brand ownership at top management level. Brand-guided companies occur across all industries.

Emerging brand companies

…have not yet fully recognized the importance of brands for their business success but expect brands to become increasingly important over the next five years. They are working on establishing a common understanding of their brand within their company, but have not yet established clear brand ownership.

Brand-agnostic companies

…do not consider brands to be an important factor to their business success today and do not believe they will be important in the next five years. They do not intend to develop a common understanding of their brands within the company and have no interest in establishing clear brand ownership in their organizations.

Brand-guided companies have clearly-defined brand values that are understood throughout the entire organization. They establish well-defined ownership for management of the brand at top management level. This enables the brand to provide the cohesive force that guides key activities—such as product development, customer service, sales, and operations—and supports the strategic management process.

On average, the research shows that brand-guided companies have profitability margins nearly twice the industry standard.

The study also identified 10 key attributes of brand-guided organizations.

  1. The company recognizes that the brand is a key asset in delivering its strategic targets at a level that is higher than the industry standard
  2. The company doesn’t consider the brand as merely a communications issue—brand is recognized as the key platform to link the company strategy with customers and employees
  3. Brand management processes are integrated seamlessly into the company’s processes—i.e., “branding” is not a separate activity
  4. Success is generated by corporate confidence—the brand delivers that success by providing a catalyst for the company’s products, services and employees
  5. Senior management is accountable for the brand’s continued health—brand responsibility resides at C-level
  6. All employees share a belief in the brand as well as a common understanding of it, the power of the brand acts as an incentive to employees, employees’ activities are aligned with the brand values and contribute to building and strengthening the brand, and employees are measured and rewarded by the success of these brand-guided activities
  7. Marketing department is able to talk in terms of expected return on their investments—marketers can leverage customer insights to make the most effective marketing decisions, they can also analyze what they know about customers to contribute effectively to strategy in the future, and marketing activities are always closely aligned with the core brand values
  8. The company has sufficient IT capability in place to capture data on customers, segment them effectively, respond to their needs, and catalyze marketing techniques to deliver high ROI
  9. The company assesses key performance indicators, such as “share of wallet,” on a regular basis—as a result of these assessments, you take appropriate management action
  10. The company identifies brand equity (the financial value of your brand)— understanding the brand’s value drivers and the levers required to influence these drivers

Via Bnet.

5 Dimensions of Brand Identity

Brand identity is composed of various shares that trigger particular responses in consumers in addition to filling the afore-mentioned functions. These shares build on one another; the more shares a brand has, the stronger and more positive the relationship with consumers.


At the very lowest level, mind share must be created in the consumer consciousness (cognitive level). This means that, as a complex perceptual and conceptual construct, the brand evokes an internal neural representation in the minds of consumers, leaving behind certain brand impressions.


This refers to the emotional relationship a consumer should develop with a brand. Heart share is less a matter of a product’s functional utility and more a matter of its symbolic attributes. The buyer of a Ferrari, for instance, will not develop an affection for the car based purely on functional attributes, but rather as a result of the values associated with the brand and the brand environment it operates in.

Buying intentions

Brand identity must trigger a buying intention share in consumers. After all, despite the importance of a brand’s mind and heart share, it only makes sense for a supplier to invest in brand identity if consumers will also want to buy the brand.


Brand identity contributes to self share, which means that the brand functions as a manifestation of the self, a tangible expression of self-image within the social environment. In this context, brands serve self-expression and self-design purposes, differentiating the individual within the social group. Brands can easily serve similar ends in the realm of business-to-business, where they bolster self-image in terms of a company and its functions.


Here, the brand shares in the existential search for meaning conducted by a consumer in a world enlightened to the point of meaning-lessness and takes on a virtually religious character. This aspect sheds light on the cultural-sociological proposition that brand management is worshiping the customer. Brands allow consumers to achieve social position or status, to partake of cultural expression, to create mythology and shape meaning, and as a result, to weave themselves into the social and metaphysical fabric of the world. In this context, a loyal customer is a member of a community and an individual loyal to that community not just a customer who makes repeat purchases. A brand is a tool for building a sense of community and belonging, for building the community itself.

Employer Branding

Just found an interesting report published in February by European Management Journal on a pretty hot topic nowadays: Employer Branding.

One increasingly important claim for contributing to sustained corporate success is to build bridges between the HR and the marketing function and to draw from its literature and practice on branding. Thus building, or just as often defending, a brand has become a major concern of organizations in all industries in the private sector. In addition to the for-profit sector, increasingly public sector and voluntary sector organizations are coming to realise the importance of branding, investing significant resources in building brands and trust relations with their clients and customers.

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Five Priorities for Brand Differentiation

Marketing leaders across various industries point to brand differentiation as their top challenge in 2005. Industry consolidation and buyer caution put a premium on brand leadership. Yet marketing budgets are barely growing and traditional brand building has fallen prey to the demands for quantifiable sales results. Buyer skepticism tunes out the constant chatter of me-too marketing claims. And the mergers and acquisitions reshaping the industry confuse buyers even more about who can do what for whom.

Real differentiation is possible, however, for companies willing to invest creatively in ongoing programs to build and promote a compelling story. Specifically, there are five investment areas that separate today’s brand leaders from the rest of the pack:

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Brand management in lean times

Anyone can do marketing with a blank check. Lean times, or even the threat of lean times, force us to be more careful in our decision making. Which brands should we push? Where should we promote our brand? How can we avoid duplication? Who is our target audience?

Cost-cutting measures include co-branded advertising, consolidating outside vendors, and cutting down on printing costs by creating more electronic promotional materials. More than that, here are 4 key areas, proposed by Lippincott & Margulies, to review in order to increase brand and branding efficiency in slowing economy:

1. Tighten the communications reins

During prosperous times, when companies are constantly unveiling new products and services, marketing materials can often grow out of control. An objective communications audit is the first step to ensuring that all marketing efforts are consistent and not wasteful.

A review of all marketing support materials can help companies to identify what materials are being produced, who’s producing them, the cost for each, and then the total marketing communications cost. This is often a surprisingly large pot of cash. It also results in identifying the audience for each communications vehicle. Completing this kind of company audit can help companies identify where their efforts are repetitive, and possibly even unnecessary.

2. Brand head count

Through a brand portfolio analysis, companies can take a serious look at their products and services to determine their target audience. After evaluating each brand by grouping it in a designated category and assigning it to a key audience, a company can then step back and decide if support for some of those brands can be consolidated, cut back or eliminated.

3. Assess advertising spending

Heavy advertising spending is not a prerequisite for building a strong brand. Understanding who your targets are, and then prioritizing those audiences, can help in ascertaining where advertising is a necessity and where it’s a luxury. By narrowing the focus and sharpening the message content, companies can use creative, less expensive alternatives to communicate to who’s critical and not to who isn’t.

4. Centralize brand management

Develop decision-making tools based on a set of criteria to manage naming, co-branding and marketing expenditure. Developing a permanent set of criteria will also ensure that future branding issues are decided upon consistently and efficiently.

Brand-Customer Relationship

Brand is often limited in its definition to awareness of a product or service. A company markets its brand – creates the name, broadcasts it to target customer segments, and applies it to its corporate identity or a set of products and services. The brand makes the company, product, or service recognizable.

This limited view of brand is destined to fail in today’s business environment. Marketing, which orchestrates only a small part of the brand-customer relationship, puts the face on the brand, making a set of promises.

Creating a coherent brand experience requires aligning every touchpoint of your organization with your brand. The more perfect that alignment, the more perfect the customer brand experience. You can’t escape your brand. Either you make the customer experience, or it gets made without you. Brands are essentially the collective perceptions of an organization’s key constituents (customers, suppliers, investors, employees, etc.) and are defined more by deeds than by words. Brand is how your customer experiences what you do.

Visionary companies recognize that responsibility for brand management belongs with the organization as a whole.

It’s your choice: deliver an effective brand experience or don’t. If you’re active in shaping the customer experience you can develop a rich and long-lasting relationship, firmly based in your brand. Where you fail to create a strong relationship with customers, a competitor will. Here are five places to start:

1. Clearly articulate your brand identity. If you can’t clearly articulate your brand identity, you’ll be unable to control how customers interpret it. A clear brand identity sets expectations across your organization for your products and services.

2. Establish a customer value proposition and use it to guide each department. The various departments responsible for delivering against your customer value proposition need to understand what the customer value proposition means to them.

3. Define the optimal customer experience. Identify the contact points where customers interact with your company.To create a holistic brand experience, you need to create a consistent and compelling experience at each of these touchpoints.Take an outside-in perspective when aligning each department with your customer value proposition and brand identity.

4. Cultivate relationships with customers. Treat these relationships carefully. Listen attentively to what you’re being told, learn from it, and respond.

5. Strengthen your brand over time. Based on what you learn from your customers, recalibrate your brand. Always be aware of how your brand can strengthen your brand-customer relationship.